TSLA Market Action: 2018 Investor Roundtable

[KarenRei]

Everyone agrees that there should be scrap. The controversy was with respect to the amount - allegedly hundreds of millions of dollars, Tesla said much less. Tripp seems to have published some documentation now for the greater amount. Could have been falsified, I suppose...

7 1/2 billion in revenue in the quarters of 2018 before Tripp (now demonstrably) copied their internal servers, and that's supposed to be some horrific amount of scrap (he showed, what, $160M total, assuming that's legit)? Come on.

Scrap goes under COGS. Gross margin is revenue minus COGS, over revenue. Hence, scrap lowers gross margin. And hey, whatdyaknow, Tesla started out with very negative gross margins on the Model 3, went to somewhat negative, now to slightly positive, and soon very positive. Because in all manufacturing processes, when you're ramping up a new line, you have high levels of scrap, which decreases as you refine the process.

He also - very strangely - seems simultaneously mad about defective parts being thrown away, and about defective parts being refurbished. I'm not sure what exactly he wants - except perhaps for a new manufacturing line to pop into existence without generating any scrap when producing billions of dollars of hardware?

 

[ZachShahan]

On a lighter note... I woke this morning and was bummed for about 5 minutes because of today's dip and I could have gotten in lower than yesterday.

Then I realized I own even more of one of the best companies in the world! That's a wonderful thing at any price and we are so fortunate we can even do this at all.

"one of the best"?
What are you a bear now?
A short?
A troll?

Come on, dude.

 

[Electroman]

Sure seems fishy that he is now going hardcore on twitter to try to persuade people. IMO, a clearcut whistleblower case would certainly not need or even want that. However, a whistleblower case will take a while regardless, so perhaps he is trying to generate a quicker reaction for whatever reason he has (cough, hoping for settlement). I think this guy is very much hoping for a settlement.

Settlement? Oh you mean between 18 years vs 10 years?

2nd degree felony vs misdemeanor ?

If I were Tesla I wouldn't settle for anything less than 20years.

 

[notacoalminer]

And all it takes is 1 tweet - Am considering to reconsider taking Tesla private.

Isn't it amazing how simple these things are?

(I'm trying this for the third time).

It doesn't work like that. You can't simply undo this mess. "Oh, never mind". Nope.

When he suddenly tweeted about taking Tesla private, it was a bombshell. Apparently, not only to us, but to his board (though of course I don't know that for certain). This is not the proper way to handle things.

When he the said 'funding secured' - I think that's when we all started to breathe a sigh of relief.

But it turns out that this does not appear to have been the truth, as far as I can tell, and I hate it that it's like this. Because I trusted him. When he said, essentially, it's all in place, apart from shareholder agreement. I believed him.

What do I feel as a huge fan?

What do all the non-fans and skeptics out there feel?

What does anyone in the world of finance think about this way of conducting business?

This is a misstep of possibly game ending proportions.

 

[kelly]

I would have to wonder if his lawyer dumped him... And if he hasn't already he might now.

As recently as 8/9, Tripp's attorney @RMitchellAtty has posting negative Tesla tweets. One of his tweets takes you directly to a Seeking Alpha hit piece. A class act.

and

 

[hellnoICE]

(I'm trying this for the third time).

It doesn't work like that. You can't simply undo this mess. "Oh, never mind". Nope.

When he suddenly tweeted about taking Tesla private, it was a bombshell. Apparently, not only to us, but to his board (though of course I don't know that for certain). This is not the proper way to handle things.

When he the said 'funding secured' - I think that's when we all started to breathe a sigh of relief.

But it turns out that this does not appear to have been the truth, as far as I can tell, and I hate it that it's like this. Because I trusted him. When he said, essentially, it's all in place, apart from shareholder agreement. I believed him.

What do I feel as a huge fan?

What do all the non-fans and skeptics out there feel?

What does anyone in the world of finance think about this way of conducting business?

This is a misstep of possibly game ending proportions.

I suspect you are a troll because Tesla investors have more balls and conviction than you are showing.

Just because this is not unfolding on your timetable does not mean investors are not there. If I had Larry Page’s money I would throw it at Elon with a Giant Thank You.

 

[KarenRei]

(I'm trying this for the third time).

It doesn't work like that. You can't simply undo this mess. "Oh, never mind". Nope.

When he suddenly tweeted about taking Tesla private, it was a bombshell. Apparently, not only to us, but to his board (though of course I don't know that for certain). This is not the proper way to handle things.

When he the said 'funding secured' - I think that's when we all started to breathe a sigh of relief.

But it turns out that this does not appear to have been the truth, as far as I can tell, and I hate it that it's like this. Because I trusted him. When he said, essentially, it's all in place, apart from shareholder agreement. I believed him.

What do I feel as a huge fan?

What do all the non-fans and skeptics out there feel?

What does anyone in the world of finance think about this way of conducting business?

This is a misstep of possibly game ending proportions.

Are you for real?

1) The board was informed on 2 august. Only the tweeting about what was going on and the wording came as a surprise.
2) Sorry that Musk didn't carefully choose his words like the lawyer-turned-PR person we all know him as (/snark)
3) "game ending proportions"? If you call potentially years for the SEC and lawsuits to cost Musk (not Tesla) a couple tens of millions of dollars "game ending", sure.

I almost pasted this graphic into the thread, but decided to take a lesson from Musk's impulsive tweeting and decided to go with this one instead:

 

[glhs272]

7 1/2 billion in revenue in the quarters of 2018 before Tripp (now demonstrably) copied their internal servers, and that's supposed to be some horrific amount of scrap (he showed, what, $160M total, assuming that's legit)? Come on.

Scrap goes under COGS. Gross margin is revenue minus COGS, over revenue. Hence, scrap lowers gross margin. And hey, whatdyaknow, Tesla started out with very negative gross margins on the Model 3, went to somewhat negative, now to slightly positive, and soon very positive. Because in all manufacturing processes, when you're ramping up a new line, you have high levels of scrap, which decreases as you refine the process.

He also - very strangely - seems simultaneously mad about defective parts being thrown away, and about defective parts being refurbished. I'm not sure what exactly he wants - except perhaps for a new manufacturing line to pop into existence without generating any scrap when producing billions of dollars of hardware?

Looking at the Martin Tripp pictures, I am left unimpressed. Tesla most definitely did have problems ramping up production of modules that was very publicly known. I have heard a few stories of the early days of getting module production running. Having water tanks right next to the production line because a robot or production equipment would touch/puncture a cell, cause a short/flare, then they would quickly dump the module into the tank to prevent a chain reaction fire. All part of the business of learning and ramping production. Nothing to see here.

 

[Starno]

I feel like this deal is too rushed out. Elon should have taken his time. Which is probably an oxymoron, but whatever.

Also, even though I accept this deal, I'm still not appreciating it. I still think it's unnecessary, and from a selfish standpoint : I won't be able to take advantage of the mood of the market to accumulate

 

[hellnoICE]

Are you asking for my real name? I invite the board moderators to check me out on google and I can give them my Twitter account. And my E*trade account. And the photo of my model 3 reservation from 3/31/16.

But I can't show you the incredible amount of mental energy and love I have poured into this project (Elon et al) over the years. good day.

Very upsetting to be attacked like this. very upsetting. years and years of defending Elon from all and sundry, now this. Don't believe me? Here, have a moderator check me out - PM me.

If you’re for real then chill.
You douth protest too much I think.

 

[ZachShahan]

Are you asking for my real name? I invite the board moderators to check me out on google and I can give them my Twitter account. And my E*trade account. And the photo of my model 3 reservation from 3/31/16.

But I can't show you the incredible amount of mental energy and love I have poured into this project (Elon et al) over the years. good day.

Very upsetting to be attacked like this. very upsetting. years and years of defending Elon from all and sundry, now this. Don't believe me? Here, have a moderator check me out - PM me.

It just seems weird to many of us that a long-term Tesla follower and investor would fall for the FUD at the last minute.

 

[ThortsMD]

That needs a bit of context. Current grid mix is 58% coal and the growth going forward is almost exclusively in renewables:

View attachment 326062

This is not the best of news. It actually means about a 10% increase in coal use compared to 2016 in China (1625 * 58% = 942 GW in 2016 vs 3188 * 32% = 1020 GW in 2040 produced by coal). It means a slight increase in their CO2 production.

 

[notacoalminer]

If you’re for real then chill.
You douth protest too much I think.

It's 'doth'.

No, not too much. I joined this forum a few days ago because Tesla has been my major passion for years but I've never had anyone to talk to about it except uninterested parties, who thought my interest amusing and a bit ...strange. They didn't get it. After The Tweet I spent a gazillion hours reading every single investment post and finally decided to hop in.

But anyone who expresses any doubt, you attack.

I started all this explanation because someone upthread was wondering why the SP isn't rising to 420. This didn't make sense to them. To me it does, so I explained what I think is going on.

 

[hellnoICE]

If you don't like the Saudis, would you prefer the Chinese?

I’d prefer Apple, Tim Cook, Alphabet, Larry Page, Sergei Brin, Bill Gates, ...

 

[notacoalminer]

It just seems weird to many of us that a long-term Tesla follower and investor would fall for the FUD at the last minute.

Can I PM you my Twitter account, but we'll keep it private?

 

[ZachShahan]

Can I PM you my Twitter account, but we'll keep it private?

i actually believe you.
just trying to explain why your post seems odd.

 

[hellnoICE]

It's 'doth'.

No, not too much. I joined this forum a few days ago because Tesla has been my major passion for years but I've never had anyone to talk to about it except uninterested parties, who thought my interest amusing and a bit ...strange. They didn't get it. After The Tweet I spent a gazillion hours reading every single investment post and finally decided to hop in.

But anyone who expresses any doubt, you attack.

I started all this explanation because someone upthread was wondering why the SP isn't rising to 420. This didn't make sense to them. To me it does, so I explained what I think is going on.

If you’re a Tesla fan you should be highly sensitized to the overwhelming torrent of pure *sugar* out there. You toss out phrases like game ending and expect not to be called on it?

 

[notacoalminer]

If you’re a Tesla fan you should be highly sensitized to the overwhelming torrent of pure *sugar* out there. You toss out phrases like game ending and expect not to be called on it?

That's how I feel. Furthermore, I think that might be how many non fans see it. Can I express an opinion about this without being called a troll? It's highly offensive.

 

[ZachShahan]

That's how I feel. Furthermore, I think that might be how many non fans see it. Can I express an opinion about this without being called a troll? It's highly offensive.

Are you seeing way more FUD on TV than you are used to?

Are sites you normally trust shifting on Tesla?

I'm curious what is causing your POV to change.

 

[Opus BC fan]

I think the SP in the short term is going to stay down or go down even lower.

The reason is right now in the short term, it is in EVERYONE's interest for the stock price to be depressed. Tesla wants the price to be depressed to make the $420 offer more attractive. The investors want the SP to be depressed so they can quietly buy cheap and prevent needing to raise the $420 offer. The shorts obviously want the price down.

Therefore, even when good news comes, like the impending 6k/week announcement, the stock price is likely to jump, then pushed down quickly. It's in everyone's interest to keep the stock price low, and it will stay low. If Tesla's finance team is smart, and I think they are, they will take advantage of the short's shenanigans on depressing the SP to their advantage.

This is an excellent summary IMHO. As a "buy and hold" investor I am looking for the lowest price right now to maximize my long-term gains. The shorts want to exit quietly. Aside from revenge fantasies (and there are many for the short/bear FUD), there is no upside to seeing the price spike for me prior to going private.

I will certainly get more of my day job done once "going private" happens. The signal to noise ratio on this thread is burying some good points that are very relevant.